SOFA 2013

Presented by

ROBERTO V. GARCIA Chairman and Administrator

Subic Bay Metropolitan Authority

BUILDING THE NEW SUBIC

Key Performance Indicators (2012 vs. 2011)

Major developments affecting 2012

VIP (Vietnam / Indonesia / Philippines) emerging dragon economies

on radar screen of foreign investors

Strong Philippine economic performance due to investor confidence

arising from good governance practices

United States “Asia Pivot” strategy

National government’s decision to utilize SBIA as the Philippine Air

Force’s forward operating base as key defensive strategy

3 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

Key Performance Indicators

NEW PROJECTS AND INVESTMENTS

KPI 2011 2012 Variance

Total Committed

Investments US$959 M US$70 M

Cumulative

Investments

(1992-2012)

US$7.83 B US$7.90 B

No. of New

Projects 127 351

176%

93%

0.9%

New Approved Investments

2011 Top New Approved Investments

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 5

Rank Company

Committed Investments

(In US$) Converted to PhP

(US$1 = PhP43)

1 Energy Logics Solar Holdings, Inc. 458,500,000 19,715,500,000

2 HydroChina Subic Limited Corp. 450,000,000 19,350,000,000

3 Multifront Marketing Corp. 22,696,323 975,941,897

4 Filhan Hotel Leisure & Dev’t. Corp. 2,222,222 95,555,546

5 Subic Super Yacht Haven, Inc. 1,995,000 85,785,000

6 Rowena Minoo Samurai, Inc. 1,500,000 64,500,000

7 Bigrid Corp. 1,150,855 49,486,765

8 First Subic Food Ventures Corp. 932,000 40,076,000

9 Others 20,515,258 882,156,086

GRAND TOTAL US$ 959,511,658 PhP 41,259,001,294

New Approved Investments

2012 Top New Approved Investments

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 6

Rank Company

Committed Investments

(In US$) Converted to PhP

(US$1 = PhP42)

1 Malayan Towage and Salvage Corp. 11,627,000 488,334,000

2 Astro Air International, Inc. 5,270,000 221,340,000

3 Raizen Asia Pte. Ltd. 5,200,000 218,400,000

4 Subic Ray Corporation 4,597,500 193,095,000

5 NSStern International, Inc. 3,609,112 151,582,733

6 Elite Delight Investments Ltd. 2,325,581 97,674,419

7 Global Daeil Subic, Inc. 2,047,619 86,000,000

8 Magnum Air (Skyjet), Inc. 1,599,302 67,170,697

9 AIA Planters Aviation Corporation 1,350,000 56,700,000

10 First Subic Food Ventures Corp. 1,218,333 51,170,000

11 Others 31,611,834 1,327,696,967

GRAND TOTAL US$70,456,281 PhP2,959,163,816

New Approved Foreign and Local Investments

New Approved Investments (2011 vs 2012)

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 7

Committed

Investment 2011 2012 Increase

Total in US$ 959 M 70 M (889 M)

Less

Renewable

Energy Projects

908 M

Net New

Committed

Investment

51 M 70 M 19 M

37%

Key Performance Indicators

EXPORTS

Our Top 3 Exporters in terms of FOB Value

8 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

KPI 2011 2012 Increase

Export

(FOB Value) US$0.826 B US$1.927 B

133%

Rank Exporter FOB US$

1 HHIC-PHIL 1.189 B

2 SANYO DENKI 0.144 B

3 JUKEN SANGYO 0.083 B

Key Performance Indicators

EMPLOYMENT GENERATION

KPI 2011 2012 Increase

No. of Jobs

Generated 88,957 89,104

0.17%

2012 Workforce by Business Sector

SERVICES 42.64%

SHIPBUILDING MARINE RELATED

SERVICES 30.61%

CONSTRUCTION 9.10%

DOMESTIC HELPERS/

CARETAKER 0.61%

MANUFACTURING 17.03%

Contributing to the National and Local Economy

BIR & BOC CASH REMITTANCES

TO NATIONAL GOVERNMENT

Collecting

Agency 2011 2012 Increase

BIR PhP 1.107 B PhP 1.286 B

BOC PhP 6.117 B PhP 6.329 B

TOTAL PhP 7.224 B PhP 7.615 B 5.42%

16.22%

3.47%

Contributing to the National and Local Economy

NATIONAL GOVERNMENT AND LGU SHARES

11 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

Allocation from

5% Corp. Tax 2011 2012 Variance

National PhP199 M PhP187 M

LGUs 145 M 139 M

TOTAL 344 M 326 M

4%

SUBIC 18 M

CASTILLEJOS 10 M

SAN MARCELINO 15 M

SAN ANTONIO 11 M

MORONG 11 M

HERMOSA 13 M

DINALUPIHAN 16 M

OLONGAPO CITY 32 M

6%

5%

GAINING GROUND

2012 Major Developments and Accomplishments

Financial Performance

HIGHEST PROFIT IN SBMA’S 20-YEAR HISTORY

13 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

Net Income

After Taxes

2011 2012 Increase

(PhP 1,118 M) PhP 811M 170%

2012 Financial Turnaround

O F F I C E O F T H E A N D A D M I N I S T R A T O R

Gross Revenues vs. Net Income

Total cumulative loss reduced from PhP 7 to 6.2 Billion

2012 Financial Summary

2011 2012 Variance

Revenues PhP 1,410 M PhP 1,634 M 16%

Operating Expenses (1,082) (1,006) -7%

EBITDA

(Operating Profit) 328 628 91%

Depreciation (676) (742) 10%

EBIT (342) (115) 67%

Other

Income/Expenses (766) 926 221%

Net (Loss) Profit (PhP 1,113 M) PhP 811 M 173%

Increased Revenues by 16%

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 16

Revenue

Source Increase

Land and

Buildings PhP85 M 12%

Regulatory

Income 84 M 74%

Seaport

Operations 63 M 19%

Airport

Operations 3 M 7%

CUSA and Admin Fees (AF)

Collection of unpaid past due

accounts, totalling PhP34 M

Admission Fees of PhP36 M

for motor vehicles and heavy

equipment

Increase of PhP20 M in

SBMA’s Gross Revenue Share

from locators

Increased fees (Co-location /

Visa and accreditation /

CRTE/PTO / Vehicle Registration)

CUSA Total Collected 12 M

AF Total Collected 3 M

Reduced Expenses by 7%

CUT OPERATING EXPENSES WITH AUSTERITY MEASURES

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 17

Expense Item Decrease

(In Peso Thousands)

Manpower 33,323 (17%)

Others (Rentals, meals,

reimbursements, etc.) 8,375 (47%)

Power & Water 4,251 (18%)

Supplies & Fuel 2,561 (57%)

Advertising 1,717 (64%)

Communication Services 1,036 (34%)

Repairs & Maintenance 360 (36%)

Travel & Training 290 (71%)

Low CAPEX

CUT CAPITAL EXPENDITURES

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 18

CAPEX Decrease

(In Peso Thousands)

Land & Land

Improvements 22,233 (84%)

Equipment Outlays 4,534 (27%)

IT Outlays 7 (100%)

Foreign Exchange Gains

19 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

FAVORABLE EXCHANGE RATES

ON SBMA’S FOREIGN LOANS

2011 2012 FOREX Gains

(PhP .566 M) PhP 1.11 M 297%

Increased Operating Profit by 91%

20 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

The bottomline is that EBITDA substantially

increased.

2011 2012 Increase

PhP 328 M PhP 628 M 91%

2012 Development Highlights

SEAPORT

Launch of Vale’s Ore Transhipment Hub

Start of commercial operations of New Container Terminal 2

Successful holding of First Subic Bay Maritime Conference & Exhibit with

more than 500 foreign and local participants

Creation of SBMA-initiated Maritime Technical Working Group to implement

stakeholders’ recommendations made during the Conference

Approved contract and project along Argonaut Highway for a super yacht

marina facility

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 21

2 0 1 1 S t a t e o f t h e F r e e p o r t A d d r e s s

NEW MARITIME

PROJECTS

Malayan Towage and Salvage

Corporation

HY Shipbuilders Corporation

Asia Pacific Chartering Phil., Inc.

Sea-tech Marine Automation Co.,

Ltd.

Multihullsdirect Corporation

Seaport

OPERATIONS

Seaport

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 23

KPI 2011 2012 Variance

Gross

Registered

Tonnage (GRT)

14,049,553 23,902,552

No. of Ship

Calls 1,803 2,003

Containerized

Cargo (in TEUs) 27,671 36,304

Non-

containerized

Cargo (in MTs)

2,593,117 2,213,709

70%

11%

47%

15%

2012 Development Highlights

AIRPORT

Suspension of development plans for airport conversion to a

world class tourist destination in deference to national security

concerns

Promotion of SBIA for general aviation, aircraft repair, jet

charters and other allied aviation activities

Use of the airport area as staging ground for various events

ranging from car test driving/product launching, movie

filming/photo shooting by different TV networks and advertisers,

sky diving and triathlon to the VFA or RP-US Mutual Defense

Treaty Exercise

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 24

Airport

OPERATIONS

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 25

Source 2011 2012 Variance

Lease PhP 32.78M PhP 30.56M (5.6%)

Airport Fees 3.75M 5.80M 54.4%

Royalty .12M .17M 40.1%

2012 DEVELOPMENT HIGHLIGHTS

513% increase in the number of leisure-related new and expansion

projects (319 in 2012 vs. 52 in 2011)

Opening of Ayala Land Harbor Point Mall

Resom Resort Philippines development of hotel, casino and golf course in

various areas

Subic Ray Corporation residential/condotel facility at Moonbay Marina

area

American International School at the former Legenda Suites

McDonald’s at Harbor Point and Rizal Highway

Subic Bay Peninsular Hotel (Former Grand Seasons Hotel and Casino)

Puregold Supermarket at Fortuna Anchor Mall, Harbor Point

26 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

Tourism

Tourism

Increase of 130 in the number of

new hotel rooms

38 rooms (Terrace Hotel)

60 rooms (Mango Valley III)

20 rooms (Jusco Hotel)

12 dormitory rooms (The Cabin)

Increase of 26% in the number of

other tourism-related facilities

Ayala Land’s Harbor Point

274 new merchant stores

Four (4) state-of-the-art cinemas

Average foot traffic of 29,600 on

weekdays and 39,713 on

weekends

Additional 31 new restaurants/dining

facilities, including those at Harbor

Point

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 27

2012 DEVELOPMENT HIGHLIGHTS

Development of Subic Bay as Tourist Destination

Tourism

TOURISM TRAFFIC (Arrivals via SCTEX only)

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 29

Year Visitor

Arrivals

Tourist

Arrivals

Hotel

Guests

Hotel

Occupancy

Rate

2012 5,228,434 1,252,217 1,208,151 69%

2011 4,631,696 1, 150,637 1,106,571 71%

Variance 13% 9% 9%

2%

Development of Subic Bay as MICE Destination

Tourism

MICE

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 31

Meetings/Incentives/Conventions/

Exhibitions No. of Participants

Classification 2011 2012 Increase 2011 2012 Increase

International 11 20 82% 2,725 8,955 229%

Local 131 273 108% 104,382 119,673 15%

TOTAL 141 293 108% 107,107 128,628 20%

Tourism

SPORTS

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 32

Sports Events

Classification 2011 2012 Increase

International 8 15 88%

Local 27 33 22%

TOTAL 35 48 37%

2012 Development Highlights

Orica Philippines, Inc., first SBF locator

that will use our bunkers in Ilanin Forest

East – Sustainable Use Zone as

regional logistics hub

Linneman Technologies, Inc.

Global Architectural Fabrications Subic

Innovative Fibre Industries, Inc.

Vibro Equipment & Parts Far East Co

33 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

INDUSTRIAL LEASES

2012 Development Highlights

Repossession from defaulting or non-paying locators and residents of leased

premises, totaling some 257,786 square meters (SQM) of land.

Continuous business mapping of

locators and residents, resulting in

billings of PhP5 M and $10 K for SBMA

sublease shares

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 34

Facility Land Size (SQM)

Paradise Consulting 45,097

Wanbol Area 44,022

Legenda Suites 40, 000

Firing Range 36,261

Edu Palace 25,000

Go-Kart Area 21,020

EOD Area 14,763

“Blue Skeleton” 10,519

Mini-Golf Area 10,000

Aparri Electronic

Corporation 8,104

Summit Hotel 3,000

INDUSTRIAL LEASES

2012 Good Governance Initiatives

Rice Smuggling

Additional control measure,

requiring importers of restricted

goods to secure the necessary

permits from concerned

government agencies prior to

unloading the goods in the

Freeport

Suspension of concerned SBMA

officers and revamp of Seaport

Department

Suspension of involved

trader/locator and subsequent

cancellation its CRTE and PTO

Waste Dumping

Suspension of operations of Glenn

Defense Marine and other waste

service contractors, involving the

collection and disposal of ship

sewage using sea vessels

Additional preventive measure,

requiring that all such sea vessel

sewage are to be collected directly

from the ship at the pier and

transported by accredited land-

based haulers to be treated in

accredited waste treatment plants

Coordination with DENR and

Philippine Coast Guard for

imposition of appropriate penalties

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 35

ACTIONS TAKEN RELATIVE TO CONGRESSIONAL HEARINGS

2012 Good Governance Initiatives

Creation of Regulatory Monitoring Unit for easier

inspection process for renewal of Business Permit

to Operate (BPTO)

Conduct of Social Acceptability Process for RP Energy

project and publication of its final report in SBMA’s website

Management reorganization

Implementation of “NO PLASTIC POLICY”

Continuing improvement of Freeport image through

“OPERATION FACELIFT”

Launching of “COMMUNITY WATCH PROGRAM”

Set up of “PROJECT UNITY” with LGUs

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

TAKING OFF

Plans and Prospects for 2013

Asia’s Newest Emerging Dragon

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 38

Exchange rate improved by 3.70%

Asia’s best performing stock market

2013 Plans and Prospects

DEVELOPMENT THRUSTS AND ACTION PLANS

1) Maximize Seaport and Airport capacity utilization

2) Aggressively promote tourism programs and build new tourism infrastructure

3) Develop idle properties and lease out remaining available lands

4) Streamline locator procedures to make them more “customer-friendly”

5) Certification by a third party certifying body in ISO 9001:2008 Quality

Management System

6) Public bidding of SBMA’s 20% share in Subic Water and Sewerage

Company, Inc.

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 39

2013 Plans and Prospects

DEVELOPMENT THRUSTS AND ACTION PLANS

7) Implement new Rationalization Plan and long overdue salary

increases

8) Complete financial re-structuring plan

9) Launch new corporate website

10) Expand SBMA territory through EO 675 to provide land for new

industrial locators

11) Purchase badly needed equipment for security, maintenance and

infrastructure

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 40

2013 Plans and Prospects

PRIORITY SHOPPING LIST

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 41

ITEM COST

RFID Gate Security System PhP50 M

CCTV System 50

IT Enterprise Resource Planning System 60

LED and other service vehicles 15

Dump trucks & garbage trucks 13

Harbor patrol boats 9

Others (Supplies, thermoplastic pavement markings, etc.) 5

Traffic light & dump truck repair 3

TOTAL PhP205 M

2013 Plans and Prospects

SEAPORT PROJECTS

Aggressive marketing by Maritime Technical Working Group for

increased utilization of New Container Terminals 1 and 2 as an

alternate port to decongest Manila

Second VALE iron ore transshipment operations

Opening of feeder lines to Singapore and Japan

Redevelopment of NSD portion

New ship building projects in Redondo Peninsula

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 42

2013 Plans and Prospects

AIRPORT PROJECTS

Aggressive marketing for general aviation,

aircraft repair, jet charters, etc.

Astro Air International, Inc.’s Taiwan-Subic-

Taiwan commercial flights twice a week

Balikatan exercises at SBIA’s South West

and South East Aprons

Department of National Defense

to occupy small portion of SBIA under

commercial terms

Application of EO 271 to be able to take a

portion of the 16 transit flights of Air Macau to

Vietnam, Malaysia and Thailand, and divert

these to Subic

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 43

2013 Plans and Prospects

44 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

SUBIC BAY AS A TOP TOURIST DESTINATION

Under Construction

Completion and

Operations

in 2013

TOTAL

Legenda Hotel & Casino 600 rooms

1,000 hotel

rooms

Buma Subic 35 rooms

Rock Crystal Hotel 200 rooms

Freeport Mansions 65 rooms

Subic Bay Peninsular Hotel 100 rooms

Freeport Elite 80 condotel units

120 condotel

units Segara Residences 6 condotel units

Mora Moto 34 condotel units

A total of 1,120 additional rooms

Subic Bay as Theme Park

Capital of the Philippines

Boardwalk Water Park

Subic Aviary and Bird Park

Holy Land Subic Sanctuary &

Theme Park

Treetop Adventure Expansion

Moonbay Marina’s River Walk

2013 Plans and Prospects

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 45

TOURISM

2013 Plans and Prospects

Subic Bay as the country’s top

sports tourism site

Continuation of current sports events

in sailing, marathon, triathlon, boxing,

cycling, beach volleyball and water

sports

Completion of Binictican golf course

Manny Pacquiao’s Sports Complex

Minanga Golf Course

Muy Thai, UFC, American Football

special events

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 46

TOURISM

2013 Plans and Prospects

Boardwalk Development Project

Resom Resort Hotel and Casino

Legenda Hotel and Casino

Prospective developers for “blue skeleton”, Boardwalk area, and SBMA

offices block

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 47

TOURISM

2013 Plans and Prospects

West Ilanin Redevelopment Project

Resom Villas & Spa Resort

Central Business District

New Royal Choices shopping center

Harbor Point Transport Terminal and Retail Area

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 48

TOURISM

2013 Plans and Prospects

Expansion of SBMA territory

through EO 675 in Redondo and

Hermosa area for new ship

builders and industrial locators

Belgium-based Enfinity

Philippines Renewable Resources,

Inc. (Solar power generation facility

to be operated by one of the

world’s leading developers of solar

photovoltaic [PV] projects)

S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y 49

INDUSTRIAL LEASES REGULATORY Creation of joint SBMA –BOC

Technical Working Group to more

effectively combat smuggling

Streamlining of business

processes to reduce requirements

and improve delivery of services

Amendments to existing

agreements with other agencies or

implementation of new agreements

Enhancement of safety culture

through CommunityWatch

campaign and intensified LED

security activities

2013 STRATEGIC PLAN SUMMARY

50 S U B I C B A Y M E T R O P O L I T A N A U T H O R I T Y

Maximize land use potential of the Freeport

Aggressively pursue JICA recommendation to use Subic

as alternate port to decongest Manila

Develop the airport for general aviation, aircraft repair, jet

charters and other allied aviation activities

Fully exploit tourism potential by creating new attractions

and destinations, promoting MICE, sports and theme parks

to attract more tourists

Invest in new equipment and infrastructure needed to

support SBMA’s strategic initiatives above

Improve the Agency’s financial performance further to

provide funds for its Strategic Plan

GOOD

GOVERNANCE

MAKES GOOD

BUSINESS.

“THE BEST IS

YET TO COME…”